Wealthy Freshmen Increase Congressional Net Worth

New members of Congress are worth $1 million more than the average incumbent, Center finds. As they make decisions about the economy, freshmen and incumbents are heavily invested in the struggling financial sector.

WASHINGTON–The new crop of lawmakers that Americans tasked in November with shoring up the ailing economy are wealthier than the group that was already in Congress, a study by the nonpartisan Center for Responsive Politics has found. And though freshmen might be worth more on average, their investments still look a lot like those of returning members–their money is primarily wrapped up in the ailing finance, insurance and real estate sector.

Congress’s new members reported a median net worth of $1.8 million in the required personal financial disclosure forms that they will now have to file annually. That’s more than twice the $815,000 median for those incumbents who won re-election.

“The new blood in Congress is mostly blueblood,” said Sheila Krumholz, executive director of the Center for Responsive Politics. “In this troubled and troubling economy, Congress remains short on lawmakers who can personally relate to what the average American is going through financially.”Virginia’s New Senator Is Richest

Sen. Mark Warner (D-Va.), who built a fortune on telecom investments, is the richest among the freshmen of the 111th Congress, worth between $60.6 million and $415.1 million, according to the report he filed as a candidate. (Members of Congress and the executive branch report the value of their investments in ranges, making it impossible to determine their precise worth. CRP calculates their minimum and maximum wealth and then averages those numbers to rank lawmakers.) Warner’s wealth isn’t enough to make him the richest member of Congress, although he comes close. He’s ranked fourth, and is behind only John Kerry (D-Mass.) in the Senate. Republican James Risch of Idaho, and Democrat Kay Hagan of North Carolina are also among the wealthiest new senators.

In total, the freshman class of the 111th Congress reported investments in the finance, insurance and real estate sector worth between $126.3 million and $352.4 million in 2007. Because of the lag in disclosure and markets’ poor performance over the last year, the current value of those investments is unknown. Nevertheless, the top industries in which the new members reported being invested are the very ones that Congress has already lent money to and will be regulating more closely, including securities and investment companies, real estate and commercial banks. New members had money invested in Wachovia, Freddie Mac and Citigroup, all of which have received financial assistance from the federal government. Some had large holdings in finance-related companies: Hagan, for example, had at least $1.4 million invested in struggling insurer Lincoln National, while new Rep. Leonard Lance (R-N.J.) had at least $500,000 invested in UBS Financial Services.

“Given how much of their own money members of Congress have invested in the financial sector, it may be difficult for some lawmakers to avoid conflicts of interest as make decisions to get our economy back on track,” Krumholz said.

In addition to finance companies, new members are invested in the agribusiness sector (at least $21.3 million) and the communications and electronics sector (at least $17.1 million). Their most valuable investments as of the filing of their reports were in companies such as telecom Syscom Services [at least $5 million, held entirely by Rep. Betsy Markey (D-Colo.)]; energy companies Teaco Energy Services [at least $5 million, held entirely by Rep. Harry Teague (D-N.M.)] and Exxon Mobil (at least $596,000) and drug maker Pfizer (at least $536,000).

For some new legislators, their ability to raise money for a winning campaign belies the success of their personal investment portfolios. New Reps. Tom Rooney (R-Fla.) and Larry Kissell (D-N.C.) each raised about $1.5 million to beat incumbents for their seats, yet they happen to be the poorest congressional freshmen. Kissell could be in debt by as much as $285,000 or worth a mere $20,000, while Rooney could be in the red by as much as $216,000 or worth up to $149,000. It doesn’t appear that any new senators who’ve filed disclosure reports are in debt–in fact, the “poorest” Senate freshman, Jeff Merkley (D-Ore.) is still worth at least $1.5 million.

“In an election about change,” Krumholz said, “this reality did not change in 2008: To win a seat in Congress, you had to be personally wealthy or know a lot of wealthy people willing to contribute to your campaign. As long as that remains true, the finances of members of Congress will continue to look very different from the average American family’s finances, regardless of the state of our economy.”

On its award-winning website, OpenSecrets.org, the Center for Responsive Politics has posted the personal financial disclosure data for new members, including their estimated net worth; a list of their assets, liabilities and transactions during the reporting period; and links to images of the actual reports: http://www.opensecrets.org/pfds/index.php.

The reports, filed when lawmakers launched their campaigns, document the period from Jan. 1, 2007 through either May 15, 2008 or 30 days after they became candidates, whichever date came later. For members who were already serving in Congress, the reports on OpenSecrets.org cover all of 2007. Lawmakers’ next reports, covering 2008, are due May 15 and should become available to the public one month later.

The Center’s analysis of new members’ wealth includes only those members of Congress who filed as candidates or whose elections were decided as of a week after Election Day. Data is not yet available for those whose elections have been decided since or those who were appointed to their seats.

For an Excel spreadsheet with the average net worth of new members of Congress and how they rank compared to one another and their more senior colleagues, click here: New Member PFDs chart.xls

. To see the minimum and maximum net worth of an individual member, click on his or her name.

ABOUT THE CENTER FOR RESPONSIVE POLITICSThe Center for Responsive Politics is the nation’s premier research group tracking money in U.S. politics and its effect on elections and public policy. For 25 years the nonpartisan, nonprofit Center has aimed to create a more educated voter, an involved citizenry and a more responsive government. CRP’s award-winning website, OpenSecrets.org, is the most comprehensive resource for campaign contributions, lobbying data and analysis available anywhere. For other organizations and news media, CRP’s exclusive data powers their online features tracking money in politics. CRP relies on support from a combination of foundation grants and individual contributions. The Center accepts no contributions from businesses, labor unions or trade associations.

Media Contact

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